I upgraded to WordPress 3.0 awhile back on the site where the below issue was noticed and in fact am running WordPress 3.1 on the site now. Today when attempting to block a new page from showing in the navigation bar via the Mandigo theme Theme Options screen I received an error complaining about permissions. I had to check to see if I had modified anything recently that could have effected these permissions but was unable to come up with anything. Turns out in the changelog that I keep the item that made the most sense was the upgrades from WordPress 2.X to WordPress 3.X. Below I describe the error in more detail followed by how to resolve the issue.
I have been using the Flexible Upload D3Z Edition WordPress plugin for a couple years now on various sites that I work on or manage. To me it provides a much easier interface to upload images while building thumbnails on the fly than the default WordPress image media upload. The issue is the Flexible Upload D3Z Edition plugin has not been updated since WordPress version 2.6.X so it has broken on more than one occasion. So when upgrading to WordPress 3 recently it broke the Flexible Upload D3Z Edition plugin and below I describe how to fix the plugin so it will operate without issue in WordPress 3.X.